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Pushing the Government to help those excluded from income support

An update on where the Government currently stands on extending income support packages and what we’ve been advocating on our members’ behalf.

08 April 2020

The RIBA has been in constant contact with the Government over recent weeks, and the need to expand current financial support safety nets has been at the top of our agenda.

As things currently stand, huge numbers of architects remain ineligible for income support. The good news is that the Government recognises this – and understands it must go further – but it needs to overcome some practical and political barriers first.

So, who's currently excluded and how might the Government help? 

From information gained through calls with MPs and civil servants, here's an update on where the Government currently stands on extending income support packages and what we’ve been advocating on our members’ behalf.

Directors who receive their income through dividends - practical barriers 

One of the largest groups who find themselves excluded from current support packages are those who receive their income as dividends as opposed to salary.

While the Government already has information on dividend income through tax returns, the tax system does not include information on the source of that income, which means automatic processing is not an option. The Treasury is currently examining ways to overcome this.

What is the RIBA doing?

Through our own work and engagement with bodies like the Creative Industries Federation, Construction Industry Council and the BEIS Professional and Business Services Group, we are pushing the Government to set up a new scheme which extends support to these groups. The new scheme could operate on the same terms as salary or through alternative means based on a standardised submission of evidence of the source of dividend income.

Directors who receive their income through dividends - political barriers

Why can't the Government treat dividend and salary income identically? The Government has been surprised by the number of people who appear to miss out on support because of the dividend issue. But we know that within sectors like music, performing arts, film and television the problems are particularly acute. If the Government does move on this issue, we understand that the compensation they offer is likely to be at a reduced rate to reflect the financial benefits these individual already receive by choosing a dividend income over a salary.

What is the RIBA doing?

We are continuing to make the case for support by focussing on why this is such a significant issue for architecture: the sector’s need to limit liability and the lack of smooth income streams due to project-based work. We are also working closely with other sectors who face similar challenges.

New businesses

For those businesses who have not yet filed tax returns, the prospect of financial support is currently limited. We understand that because of concerns relating to fraud, the Treasury is unlikely to consider allowing the use of 2019-20 tax returns as the basis for calculating support at this time.

What is the RIBA doing?

Along with other organisations, we are currently exploring what options might be available through the creation of an alternative minimum support level for new businesses or those which are not currently profitable. We are also pushing the Government to prioritise grant and loan eligibility for these types of businesses.

Those who earn more than £50,000

The cap on support at £50,000 for the self-employed has hit quite a few of our members. This decision was made by the Government because it did not want to be seen supporting those who do not need support. But it seems unfair that this cap only applies to self-employed workers, and we have been very critical of that. We will continue to argue that eligibility criteria for the self-employed should be as close to those of employees as possible.

We will continue to work closely with the Government to represent the needs of our members and push for the right support for our sector.

Those who completed our COVID-19 survey have already provided us with a rich set of case studies to share.

We encourage members with any queries relating to COVID-19 to email info@riba.org. The more information we have about the issues you are facing, the better we can advocate on your behalf.

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